Social Security official: Raid retirement fund

Proposed solution to disability-account shortfall cost $40 billion a year

Published: 03/20/2013 at 11:20 PM

(BusinessInsider) Stephan Goss, the chief actuary for Social Security (SS) provided a detailed report on the status of the SS Disability Fund (DI) to the House of Representatives. The short story is that DI is going bust in a few years. The options to fix this problem were spelled out in the report. The extremes of the required “fix” range from an immediate cut in DI benefits of 16%, or an increase in DI payroll taxes of 20%.

Nothing new there. But, there is a “Plan B” for the DI Fund. The solution is to raid the SS Retirement Fund for the deficits at DI:

A simple tax-rate reallocation between OASI and DI, as was done in 1994, could equalize the financial prospects of the trust funds avoiding reserve depletion until 2033.